Short the big housing short
In The AFR I explain why you would be better off shorting the hedge funds' "big Aussie housing short" that has attracted hysterical media attention in the last 24 hours. While I have argued since 2013 that Aussie housing is becoming increasingly overvalued, we still forecast double-digit growth in 2013 and 2014, strong single-digit growth in 2015, and capital gains at 1 to 2 times the pace of wages in 2016, which is exactly what has transpired. What these hedge funds talking up their own (belated) bank shorts---which we have advocated for completely different reasons---have missed is that it is actually easy to rationalise current Aussie house prices if you think interest rates will remain "low for long". Excerpt: "Dr Alex Joiner has demonstrated that if you take the median house price in 1985 and adjust it only by disposable income growth between 1985 and 2015 and the change in borrowing capacity (via generally declining mortgage rates, not loan-to-value ratios), you find that the 1985-adjusted value is 1% above current median prices. Read free here (VIEW LINK)
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Chris co-founded Coolabah in 2011, which today runs over $8 billion with a team of 40 executives focussed on generating credit alpha from mispricings across fixed-income markets. In 2019, Chris was selected as one of FE fundinfo’s Top 10 “Alpha Managers” based on his risk-adjusted performance throughout his career across. He previously worked for Goldman Sachs in London and Sydney, the Reserve Bank of Australia, and founded the award‐winning research/investment group, Rismark. He has regularly advised governments, developing unique policy proposals. Chris graduated with the University Medal (Economics & Finance) from Sydney University. He studied in the PhD program at Cambridge University in 2002/03, leaving to set up his funds business.
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Chris co-founded Coolabah in 2011, which today runs over $8 billion with a team of 40 executives focussed on generating credit alpha from mispricings across fixed-income markets. In 2019, Chris was selected as one of FE fundinfo’s Top 10 “Alpha...
Expertise
Chris co-founded Coolabah in 2011, which today runs over $8 billion with a team of 40 executives focussed on generating credit alpha from mispricings across fixed-income markets. In 2019, Chris was selected as one of FE fundinfo’s Top 10 “Alpha...
Expertise
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